Property Management Growth with DoorGrow DGS 182: When Potential Property Management Clients Choose A Cheaper Competitor
How do you deal with a potential client who chooses a cheaper property management company over you? Sometimes, these clients are just a bad fit, and other times, your sales pitch is actually the problem.
Join property management growth expert Jason Hull, the founder and CEO of DoorGrow and learn to deal with price-sensitive prospects and how to qualify potential clients.
You'll Learn…
[01:54] The Problem is Usually not Price, it's ____
[05:53] Why You Should Sell Certainty… Not Property Management
[07:38] Using the Golden Bridge Formula in Sales
[11:16] Why Getting Feedback in Lost Sales is Invaluable
[14:22] Building a Business You Can Sell… But Won't Want to
Tweetables"Most investors do not want to be landlords. They want to be investors."
"If you find yourself fighting to keep a client or fighting to get a client, I like to just let go of the tug of war rope."
"Nobody really wakes up in the morning, goes, "Man, today I wanna buy property management." What they want to buy is peace of mind or safety and certainty."
"Why do you wake up in the morning? Why do you live the life that you do? Why did you decide that this business was a vehicle for you to get fulfillment from and freedom from and contribution from and support."
Resources
Transcript[00:00:00] If you find yourself fighting to keep a client or fighting to get a client, I like to just let go of the tug of war rope. This is the easiest way to really win in a tug of war is to just not play the game
[00:00:11] All right. Welcome DoorGrow Hackers to the #DoorGrowShow. If you are a property management entrepreneur that wants to add doors, make a difference, help others, impact lives, increase revenue, and you're interested in growing in business and life, and you're open to doing things a bit differently, then you are a DoorGrow Hacker. DoorGrow Hackers love the daily variety, the unique challenges, and excitement that property management brings. Many in real estate think you're crazy for doing it though. You think they're crazy for not because you realize that property management is the ultimate, high-trust gateway to real estate deals, relationships, and residual income.
[00:00:48] At DoorGrow, we are on a mission to transform property management business owners and their businesses. We want to transform the industry, eliminate the BS, build awareness, change the perception, expand the market and help the best property management entrepreneurs win. I'm your host, property management growth expert Jason Hull, the founder and CEO of DoorGrow. Now let's get into the show.
[00:01:10] So today what we're gonna be talking about is-- during our Grow Call, one of our mastermind calls today, one of our clients brought up that they had a challenge. They followed up with some leads and they found out that they had gone with a cheaper competitor. And they said this had happened a couple of times, and what that tells me as a coach or as a consultant– that reveals to me that there's a leak maybe in their sales process. They might have just been a bad fit. So we always wanna qualify our clients, but I wanted to discuss today and talk about how to deal with the cheaper competitor when somebody is going with another company and how to prevent that from happening.
[00:01:50] So one of the things that I teach in our sales secrets training is, when people are really heavily focused on price, one tactic is this formula that's based on neurolinguistic programming, that: "It's not A, it's B." and so the way that you can utilize this, that "It's not A, it's B" formula is really powerful when you're trying to change people's thinking from what they're concerned about and thinking about and focused on to what they should be thinking and focused on. So the way this formula works is you just say, "The real issue is not A. (whatever they're thinking about). It's actually. B." So for example, if the real issue is not price, but they're thinking about price, you would say,
[00:02:29] "Hey, Mr. Owner, I find that the real issue and the thing that most savvy investors are focused on is not actually price. The savvyer investors and some of our best clients, what they realize is the real issue isn't price. It's actually things like vacancy. One month of vacancy, if you're paying a mortgage on the property, could be an entire year of management fees. So good property management really may not even cost you anything. If on average you're not very effective at getting the place rented out, or you have a month of vacancy, our management fees would be covered because we're really good at getting things rented out quickly, and we can decrease that vacancy. So that would cover our management fees."
[00:03:07] Or "The real issue isn't price. It might be just getting the best amount for rent, and we're really good at getting rent. And so, some people are not really good at getting the high rent, and some property management companies might not be motivated to. We know how to get the top dollar for rent, and if you haven't raised rent in the last several years and you're 10% below market value, our management fees, even if they're as high as 10% or whatever they might be, it would be offset if we just raised the rent to its effective rate that you can get in the marketplace. And so our management would basically be free. We'd be able to collect more rent and it'd be a wash, right. It wouldn't cost you anything, and you get to get this off of your plate."
[00:03:48] Most investors do not want to be landlords. They want to be investors. Right. And so you can just ask them, "Do you love being a landlord and like doing property management related tasks, or do you really just have this because you really enjoy being an investor and want more investments? Cool. Let me help you do that."
[00:04:04] So the other thing that I coached on during that call is if somebody goes with a cheaper competitor, I love to deal with the tug of war that we normally feel like we need to pull on the end of that rope. If you find yourself fighting to keep a client or fighting to get a client, I like to just let go of the tug of war rope. This is the easiest way to really win in a tug of war is to just not play the game and let them fall on their ass. Like let go of the rope, and let them, you know, let them go. So what you can do-- I would love it if you would just say to them, "Hey, no problem. You've gone with another company because they had a cheaper price. Totally cool. We are perfectly happy to be your second property management company. We're perfectly happy to be the next property manager," and then what you can do to poison the well is just say, "Look, in the future if you run into these problems..." and then state some problems that you know are likely to happen with a not as good of property management company is yours.
[00:05:02] "If you notice these red flags" or "if these things happen to you," and you can future pace them and point out typical problems that they might have with another property management company. "If this happens, when that happens, just remember us. We will still be here. Keep our phone number, reach out to us" and that sort of thing. You also can say, "and would it be cool if I checked in with you in a few months, just see how things are going?" And you can follow up with them. "How's things going with this new management company?" At the very least you could follow up just shy of a year of when their renewal date would be with that other company, just to check in with them and see: "How's your experience been with that other company?
[00:05:38] If they say it's been great, you say, "Cool, really glad you're having a good experience. If it ever changes or you wanna talk to us, you know, we'll be here." But if they haven't had a good experience, then you can deal with that. Now here's the thing to remember. Usually if somebody goes with another company, even if they claim it was based on price, it's because you failed to be effective during your sales pitch in your sales process. Remember, people do not buy property management. Most of your competitors, people that don't listen to the show, people that are not my clients especially, they are going to sell property management. Smarter companies, my clients' companies, what they will do instead is sell safety and certainty. Nobody really wakes up in the morning, goes, "Man, today I wanna buy property management."
[00:06:25] What they want to buy is peace of mind or safety and certainty. This is what they want. And so, effective property management companies don't sell property management for a fee they're selling safety certainty. Now if you recognize this, other companies will not be selling safety and certainty, they'll be selling property management. So you can be a disruptor and you can sell safety and certainty and point out flaws in other companies or red flags to look for, to poison the well that might prevent them from going with another company because those companies are not focused on safety and certainty, giving them peace of mind.
[00:07:01] They're focused on selling property management features and benefits and what they get and that sort of thing. So the way to do that-- we teach that the most effective way to create safety and certainty is to remember this quote from Simon Sinek, who wrote _Start With Why,_ he says in one of his videos, he says, "People do not buy what you do. They buy why you do it." And so one of our most effective sales formulas that we teach is called the "Golden Bridge Formula." And we teach clients how to identify their personal 'why,' how to identify their business 'why,' company core values, client-centric mission statements, some of these materials, decision-making guides, etc.
[00:07:38] This is in our Purpose Secrets training, but once you have that, you can then utilize what we call the Golden Bridge Script or the Golden Bridge Formula, which is basically sharing your personal 'why,' business 'why,' and connecting it to their 'why,' which is what do they want? So if you know what they want and you know what they're trying to get and what they're trying to have and why they have rental properties and why they're doing this, which means during your sales pitch, you need to identify this stuff first. This is the first side of the bridge. It's their side of the bridge. If you're gonna build a bridge to somewhere, you need to know where they're at, what their side is. You need to figure out their 'why,' then you can relate your personal 'why.' Like, why do you wake up in the morning? Why do you live the life that you do? Why did you decide that this business was a vehicle for you to get fulfillment from and freedom from and contribution from and support from, right? The four reasons.
[00:08:27] If you aren't familiar with that, go back and listen to my episode on the four reasons for starting a business. But they need to understand why you're doing this because if you don't relate your 'why,' they're gonna assume that your 'why' is just to squeeze money outta them, probably as unethically as possible. That's the default people assume for any business if they don't understand your real motivation. Like my real motivation, my personal 'why' statement is to inspire others to love true principles. That means I love learning what works and sharing it with other people. That's just fun for me. So I built a business that allows me to do that every day, and that's why our business 'why' is to transform property management business owners and their businesses. That 'why,' our business fulfilling on that 'why' allows me to get personal fulfillment on my 'why.' So the business is in alignment with what I want, and it's in alignment with what you want as a potential client of DoorGrow.
[00:09:19] And so there's alignment when people understand. Then, you've built that bridge. That is the golden bridge. It's the ultimate bridge. The ultimate secret for building trust and rapport quickly is to share your 'why,' the business-- why it exists-- and connect it to their 'why.' Once you've done that, there's an authentic connection between your heart and your motivation to their heart and their motivation. So they know that your interests are in alignment and they can trust you, and sales and deals happen at the speed of trust. Sales and deals happen at the speed of trust. It's not about satisfying logic.
[00:09:52] It's not about satisfying their brain. It's not about all the features and benefits. They will not go with you or work with you just because you have the best features and benefits or the best price necessarily, if they deep down don't trust your motivation and trust you to actually fulfill on it and that you have some sort of inherent motivation to get them what they want. So otherwise, they'll just assume, like I said before, that your motivation is money as unethically as possible, which should not be your motivation. Hopefully, it's not. Most business owners really do want the four reasons. They want freedom, fulfillment, contribution, and support. Money is a side effect of focusing on those things. But when you're lacking those things, then you focus on the fifth reason, which is safety certainty, and that's what your potential clients want, and if you're starving and focusing on safety certainty and giving up those four reasons, you are now a business that's out of alignment, that's less ethical, or that has problems, right?
[00:10:51] So they need to know that that's not you, so shift your focus away from _what _and focus on _why _you do what you do during your sales pitch and process, and that will distinguish you from all of your competition. So that's probably one of the biggest leaks that exist in the sales process. And so you will probably be able to poison the well or stand out, or however you want to phrase it, better than your competition, because you focused on 'why' and not 'what.' Now, if the last thing we shared, if you don't get them on as a client, it's a great idea to do some sort of, almost like an exit interview, but to reach out to them and just get feedback on why they didn't go with you. And if you frame this in a really positive way, like,
[00:11:31] "Hey, it would really mean a lot to me if you could help me out and help me understand, like what made you choose that other company over us." That feedback is invaluable for the future, so you can make changes for the future to make improvements on your pitch, on your sales process. And so if they're just like, "Hey, it was just basically price. You all look the same." That's not feedback that your price is wrong. That's feedback that your pitch is wrong, that you would look the same as everybody else. You're just a commodity. And when you don't focus on _why _and you just focus on _what,_ then you are basically saying, "I'm just a commodity. I'm like every other property management company out there." So doing these exit interviews will give you really valid feedback, you know, or whatever you would call it so that you can improve your sales process in the future. So keeping track of these in your CRM is also a good idea.
[00:12:16] So historically, we would keep track at DoorGrow. If we lost a deal, we would keep track on what the reason was. Was it because they weren't financially qualified, they didn't have the funds? Was it because they couldn't afford us? Was it because this didn't really solve some sort of pain or problem for them, they didn't have any immediate pain or problem or challenge that they needed help with? Things were pretty good. So they're like, "Why should I spend money to work on growing my business? I'm actually growing okay right now," you know, or like, "I love my day-to-day business and I love what I'm doing, so I don't need to improve that." Right? So if they don't have any pain or any problem that we can solve, that might be a reason. So it might be that they just were never available and that we couldn't communicate with them, so we just marked the deals lost because they ghosted us. And so those are the ones that we won't allow to become a client later on 'cause if they're not ethical enough or responsible enough to like, at least tell us they're not interested or to communicate with us, and they just ghost us, we're really careful about bringing those type of clients on 'cause they'd be terrible clients to work with if they're not communicating and don't communicate with us, right?
[00:13:16] So we keep track of these types of things that we get data and we can see: why are people not signing up for the program? Or why are we not closing deals? Why did we lose that deal? And going and asking people, "Why did we lose the deal?" Sometimes we're able to identify an objection or a challenge and find out they went with some alternative or they went with some other thing or they just thought something was missing or they misunderstood something in the program.
[00:13:40] "Well, you guys don't offer a website, and we needed a website with it."
[00:13:43] "Oh, well, we do. We must not have explained that during our pitch."
[00:13:47] So we can then deal with that objection and sometimes still get the business on. So getting that feedback can be very valuable. So hopefully, this episode helps you to be able to know how to deal with those cheaper competitors. I have some great episodes from the past, like with Darren Hunter on people asking for discounts. So before you lose the deal, if they're asking for a cheaper price or the price of the company competitor down the street, check out the interviews that I've done with Darren hunter fee max expert in Australia, and we got some other cool episodes that might be relevant too, dealing with sales or that. So anyway, if you are struggling with anything in your business, growing and scaling your business, we just launched this awesome program called the Rapid Revamp that is part of a bigger program called Built to Sell.
[00:14:32] And so if you wanna build the ultimate property management business, you wanna build a business that is built to sell in the next three to five years, which means in the next three to five years, you can have a seven-figure exit on your property management business because you've been able to grow it, build it up, and get yourself out of being the linchpin in the business and the day to day so that you could sell this business. And here's the secret, you may not want to sell your business. And if you can build a business that you can sell, that is the ultimate business that you would not want to sell. So building a business to sell is how to build a business to keep. This is a business that is an asset that makes you money that you don't have to be involved in the things that you don't want to, and it becomes the ultimate vehicle for you to get fulfillment, freedom, contribution, and support in. So it's actually giving you things besides just money. So you're not gonna wanna sell it for just money because it's giving you purpose in life and giving you momentum.
[00:15:26] And so that's the ultimate business. The ultimate level of freedom in a business is to have a business that you could sell if you wanted to, and you can sell it for a nice exit, not being one of the companies that sells because it's got so many problems that it's a bargain for some other company to come in and snatch up because they can improve it and make it so much better and rehab your business. Let us help you rehab your business with our rapid revamp program. So check us out at DoorGrow.com. Our next class starts in October. We've got our first class going through right now. We've got about-- I think about 50 businesses going through this Rapid Revamp. Right now, we are only planning on allowing 30 in our next class. We're allowing our existing clients to go through this class with us. The next class is only gonna be 30 slots. We're only probably letting about 10 on in a month over the next three months leading up to October. So if you want to get your spot reserved, we have some bonuses and some special things that you can have access to even before we start that class if you pay and get signed up for this class.
[00:16:28] So this is not cheap, it's not for the faint of heart, but it's way cheaper than buying into a franchise, and we even have franchisees that are going through this or that choose into this because they want to grow their business, but this is going to be an-- it's an awesome program. We're getting really positive feedback. It's a culmination of everything we learned by doing our mastermind and by doing our former Seed Program, which we had four versions of. So this is version six, I guess maybe, or more of our programs, and this is the best stuff that we know to grow businesses rapidly in a 90 day period to lay the ultimate foundation for growth, and we're calling it the Rapid Revamp, so it includes a website, includes branding-- rebranding-- logo design, includes pricing revamp. We're optimizing all the leaks that exist in your sales pipeline. It does not make sense to do marketing, advertising of any sort if you have-- turning on the hose, so to speak, of this faucet of all these things, if you have a hose connected to it, which is your sales pipeline that has massive leaks at each stage, which would be branding, reputation, website, sales process, pricing, all these different leaks. We're gonna dial in all of these leaks to a level that you have not dialed in before and make sure that your business is really effective.
[00:17:41] So I'm really excited about this program so are our clients. You should be too. So check us out at DoorGrow.com and get onboard for our Rapid Revamp program that's coming up for October, and it's gonna be awesome. So, and we kick it off with an in-person event live and it's gonna be really cool. So, yeah. Get in on this. It's gonna be really cool and you gotta be around some awesome people in your class. So anyway, until next time, to our mutual growth. Bye, everyone.
[00:18:08] You just listened to the #DoorGrowShow. We are building a community of the savviest property management entrepreneurs on the planet in the DoorGrowClub. Join your fellow DoorGrow Hackers at doorgrowclub.com. Listen, everyone is doing the same stuff. SEO, PPC, pay-per-lead content, social direct mail, and they still struggle to grow!
[00:18:35] At DoorGrow, we solve your biggest challenge: getting deals and growing your business. Find out more at doorgrow.com. Find any show notes or links from today's episode on our blog doorgrow.com, and to get notified of future events and news subscribe to our newsletter at doorgrow.com/subscribe. Until next time, take what you learn and start DoorGrow Hacking your business and your life.